Trump regulator gave quiet legal blessing to crypto trading by banks – Politico

Trump regulator gave quiet legal blessing to crypto trading by banks – Politico

A top regulator quietly determined during the final days of the Trump presidency that banks are legally allowed to trade cryptocurrencies on behalf of clients, in what could be a major breakthrough for the digital assets, according to people familiar with the matter.

The decision by staff at the Office of the Comptroller of the Currency — which has never been made public — could open the door to a whole range of lucrative activities by banks in the red-hot virtual currency market by allowing them to briefly hold crypto assets on their own books to facilitate trades. It also serves as a window into the type of internal documents at financial regulatory agencies that shape policy behind the scenes.

“Cryptoassets have grown exponentially over the last several years,” financial industry groups recently told global central banks in a letter arguing for lower capital requirements to hold crypto. Banks’ limited access to them “is neither desirable nor sustainable,” they said.

A formal move to green-light crypto trading by banks would probably be met with resistance by advocates of tough financial rules. The value of cryptoassets can shift dramatically — Bitcoin is up about 400 percent from last year — making it potentially risky for
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